|Pre Budget 2012-13||Thursday, March 15, 2012 18:06 Hrs IST|
PRE BUDGET REPORTS
Food Processing: Retain option to pay excise duty at 1% without Cenvat Credit
India is the second largest producer of food and holds the potential to be the biggest on global food and agriculture canvas, according to a Corporate Catalyst India (CCI) survey. The Indian food industry comprises of food production and the food processing industry. The food processing industry is one of the largest in India – it is ranked fifth in terms of production, consumption, export and expected growth.
Also, India is set to witness the next revolution in the food processing industry, as the Centre has set an investment target of Rs 100000 crore (US$ 18.90 billion) by 2015 in the sector. The sector is expected to grow by 20 per cent and value addition to increase by 35 per cent by 2015. Further, The Government emphasis is on improving supply chain, by creating large primary collection and distribution centers throughout the country involving private sector, in the 12th Five Year Plan (2012-17) period.
Scrip's to watch:
Hindustan Unilever, Nestle India, Marico, Britannia Industries, ITC
The Food processing industry is of enormous significance for India's development. Also, The food processing industry been identified by the Government as a priority industry in order to reduce the high wastage of farm produce in the country. However, The cumulative incidence of taxes along with increased transportation and distribution costs makes the processed food products more expensive. The greater thrust on agriculture sector will bestow double benefit of improving income in the rural hands, and improve productivity, which can contain the cost of inputs for the food-processing sector.